KAMPALA, Uganda
Climate activists are urging
more banks and insurers not to back the controversial $5 billion East African
Crude Oil Pipeline (EACOP) that is primed to transport oil from the Hoima
oilfields in Uganda to the Tanzanian coastal city of Tanga.
Influential youthful climate
activists Vanessa Nakate and Hilda Nakabuye have lent their support to
opponents of the pipeline citing the need for Africa to stay away from fossil
fuels.
The unrelenting pressure
mounted by environmental groups, under the banner #StopEACOP, has led to a
growing list of banks and insurers quitting the oil pipeline project. Just this
week the project suffered another major setback after insurer Allianz Group
pulled out of the project.
It joins 15 banks and seven
insurance companies — including HSBC, BNP Paribas and Swiss Re — who have
denied financially backing the pipeline in response to the campaign waged by
numerous environmental organizations, led by the international group 350.org.
The 897-mile (1,443 kilometer)
oil pipeline is billed as the longest heated pipeline in the world. The China
National Oil Corporation and French energy conglomerate TotalEnergies,
alongside the Uganda National Oil Company and the Tanzania Petroleum
Development Cooperation, have remained firm in pushing ahead with the pipeline
project which is expected to start transporting oil in 2025.
Johnson Nderi a financial
analyst in Nairobi supports the oil pipeline, saying “Africa needs cheap stable
power as that afforded by oil and coal, to grow its manufacturing sector.”
Construction of the pipeline
will displace thousands of families and threaten water resources in the Lake
Victoria and River Nile basins, according to 350.org. The environmental group
goes on to say that the crude pipeline will generate some 37 million tons (34
million metric tonnes) of carbon dioxide emissions annually, fueling climate
change.
“TotalEnergies is putting
profits over people and it shows. Communities in Uganda and Tanzania have been
fighting tirelessly against the planned pipeline and the trail of destruction
it is already leaving in its wake,” Omar Elmawi, the coordinator of the #StopEACOP
campaign, said.
“At a time when scientists
call for the phasing out of fossil fuel projects, to avoid the worst impacts of
climate change, it is ill-advised and irresponsible to go ahead with this
project, while ignoring the cries of those most affected.”
TotalEnergies has defended the
pipeline noting that it adheres to strict Ugandan and Tanzanian environmental
laws. An environmental social impact assessment report conducted by the
Netherlands Commission for Environmental Assessment raised concerns about
significant risks posed to wildlife notably chimpanzees in the Bugoma, Wambabya
and Taala Forest reserves.
Initially priced at $3.5
billion, the underground electrically heated pipeline will now cost $5 billion
and is expected to start near Lake Albert in Hoima District, western Uganda. It
will skirt around Lake Victoria entering northern Tanzania on its way to
Chongoleani peninsula on the Indian Ocean transporting 216,000 barrels of crude
oil per day.
The pipeline is expected to
displace over 14,000 households in both Uganda and Tanzania, according to the
international poverty charity Oxfam. But proponents of the project are citing a
$2 billion annual revenue from the oil exports alongside some 12,000 direct
jobs in its defence.
British firm Tullow Oil first
discovered oil in the Lake Albert Basin in 2006, with recoverable oil estimates
pegged at 1.2 billion barrels. In 2020, Tullow sold its entire stake to Total
Energies. In early February, the oil pipeline’s major backers, led by Total
Energies, announced the conclusion of the Financial Investment Decision, signalling
the commencement of the construction of the oil pipeline.
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